Thanks for the clarification, David. My reading comprehension ability apparently went away for a while. I'd be surprised if the CTL board ups the dividend before year end, but I'm always open to surprises....

BTW, kudos to both you and Robert Allan Schwartz for your great work ....

I just installed Preferred Search after a system image backup (I'm paranoid about backups). The good news: installation was straight-forward and the program didn't infect my system (although delayed symptoms are a possibility). The bad news: I didn't find it particularly useful, although I'm sure others will. I built a spreadsheet of preferreds from Q/O/L data a few years back, so it was somewhat redundant for me. I'll just keep using Q/O/L's search facility to incrementally add preferreds to my sheet.

What the program does, it does fast (at least if you have a fast connection). As an old programmer, I was impressed by how the author was able to retrieve significant fields, ostensibly for every preferred covered, from the Q/O/L database in one swell foop. Snap!

A word of caution: I downloaded the software yesterday and the total download count was only 18, but, based on my experience, there's probably no danger in testing the program for yourself. It's good practice to always take a backup first.....

The author could not have chosen a more biased example to lead off with than MO. Altria's financial history is badly skewed by the spinoffs of Kraft and Philip Morris Intl., which probably accounted for more than half of old MO's revenues/earnings/etc.

On the surface, you'd think Corzine was a bright guy. MBA from Chicago, e.g. But after his terms as (my) senator and governor, it became apparent to me that the man lacks two things: common sense and a spine. The real mystery is how he got to be CEO of Goldie, much like why people pay to see a Cher concert is a mystery. In retrospect, he ran Goldie at a time when anyone could have: the booming 90s. The firm is reputed to have the best and the brightest, so all he had to do was loosen the reins, let them do what they do, while he did what he does best: give long-winded speeches saying nothing and kiss the appropriate butts.

It is not a mystery to me, however, that he became a US Senator and then Governor. Here in NJ, the people will elect the scoundrel just about every time. And my defintion of a scoundrel includes anyone who would spend $20M+ of his own money to get elected.

FWIW, I ran a screen on Q/O, loosening the rate requirement a bit to 6% (coupon rate). I then eliminated issues which did not get an investment grade rating from BOTH Moody's and S&P.

The resulting issues were mostly in the REIT sector. There were only a half dozen or so trading below par, including 3 from Vornado and 1 from Partner Re and all discounts were borderline. There were 2 which are more deeply discounted, both from Aegon: AED and AEV. I suppose they are down in price because the company holds the sovereign debt of the more dubious European countries. I already own AEB and AEF, the former a floater and neither a cumulative issue. I will be looking to possibly swapping AEF for AED or AEV, perhaps after the December payment.

Actually, the exact returns may not be knowable, but one can estimate. Most floating-rate preferreds pay a fixed percentage added to a variable rate, e.g., the LIBOR 90-day rate. Plus most have a floor of 3.5% to 4%. MET-pA, e.g., pays the greater of 4% or 1% plus the 90-day LIBOR. As I write, that LIBOR rate is 0.42%, but it wasn't that long ago when that rate was north of 4%. If interest rates were to spike, it is reasonable to expect share prices to follow, i.e., rise. How much, exactly? Difficult to determine, just as it is difficult to know the precise effect higher rates would have on a specific fixed-rate issue. It all depends on the sector, health of the issuer, etc.

The conventional wisdom is that rates will remain low for some time, but nothing lasts forever. I bought several fixed-rate preferreds when they were on sale in 2009, but I have hedged that position with a few floaters and the RYDEX Inverse Treasury Fund.

Thanks for your articles. And I am very impressed with the extra effort you obviously put into your extensive author comments.

Just read '5 Dividend Stocks on Sale Now'. My favorite valuation metric is FCF Yield and, of the 5, only one looks like a buy on that basis: TEG, a utility of all things. TEG sports a FCF Yield of 17.3% for FY2010 and 13.5% TTM. Of note is that 2010 was the first year in a decade in which TEG showed positive FCF and it looks like 2011 will be a repeat of that. On the minus side, TEG doesn't qualify in my screen mentioned above, although the 3-year dividend CAGR is north of 10%. And its payout ratio is very high, maybe too high. Still, there's more than one way to evaluate a stock. I see FCF and I smell what may be value. It's time to investigate.

FWIW, I built a spreadsheet to screen utilities. I add the current yield to the lowest of the 3-, 5-, 7-, and 9-year dividend growth rates and look for those whose sum is greater than 10%. Besides a low payout ratio, I like to see at least 7 annual dividend increases in the last decade. Of the companies mentioned, EXC, NEE, NU and PPL qualify.

I recently read (could have been here on SA) that NU gets a large percentage of its revenue from Connecticut, but that CT regulators are very unfriendly toward the utility. Any opinions, pro or con ?

I am long PPL and the PPL-U and PPL-W equity units and am looking to diversify. I am looking at EXC, NU and AVA, as well as POR, although the latter lacks a 10-year history.